How much have Spanish property prices actually fallen?

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This topic contains 45 replies, has 15 voices, and was last updated by Profile photo of Anonymous Anonymous 4 years, 10 months ago.

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  • #56500
    Profile photo of Anonymous
    Anonymous
    Participant

    The big question is, how much have Spanish property prices actually fallen, peak to present?

    I’m talking about actual market prices – the prices at which properties actually sell today – not asking prices (vendor fantasies).

    Obviously nobody knows for sure, and there are no reliable statistics. So it’s just based on you personal experience, what you have seen.

    Feel free to qualify your answer with reference to location and type of property.

    So for example, I can say that middle / upper-middle class villas in the suburbs around Barcelona are down 50% or more. There are a number on the market for around 3 million, but the few that actually sell do so for 1.5 million. At the height of the boom they might have gone for 3.5 – 4 million. That’s just based on anecdotal evidence talking to agents.

    Mark

  • #107672
    Profile photo of Chopera
    Chopera
    Participant

    I’m not an agent so I can only talk about personal experience in Madrid…

    We bought an off plan 1 bed flat with pool, gym, etc in central Madrid for 265k in 2004. At peak in 2006/7 developers were asking and getting about 320k for similar flats. We sold that flat for exactly the same amount as we paid for it at the end of 2010. At the same time We paid 330k for a 30 year old 4 bed flat and our neighbours have told us they were selling for 450k at peak. Based on that and assuming prices have dropped by another 10% since then I reckon prices for flats in the 250k to 500k price range in central Madrid are down by about 30% to 35% from peak.

    Friends of ours bought a 2 bed flat in the outskirts of Madrid (where there are now a lot of empty new builds) for about 220k at around about the peak. They have recently had it independently valued at 120k. So I guess those types of flats have fallen in price by about 45%.

    I’m very interested in hearing other people’s thoughts and experiences on this subject

  • #107673
    Profile photo of angie
    angie
    Spectator

    In the Alhaurin el Grande area including the golf club, campo and suburbs, I believe actual realised prices are down from peak around 40-50% depending on quality and presentation. There are some developments like San Jorge that are more or less derelict and probably unsaleable now. I think Coin could be worse though.

    Both Alhaurin Golf and Lauro have large unfinished and unsold development.

  • #107674
    Profile photo of katy
    katy
    Spectator

    It is difficult to know as there is no transparency in Spain. There needs to be a Zoopla type website. Always a lot of bar-room talk about houses going for stupid prices but I have never actually seen them or know anyone who has. There is an example on here of Boothy who took quite a hit when he sold after just a year. Many prices a few years ago were fantasy prices anyway, some overpriced by 70%. Heard of one in the golf club bar. Reduced from 1 million to 500,000. Went to view it, was a joke. I don’t think it was worth 500,000 😆

    I know one house and this is true. Was valued in 2008 at 1.25 million. Sold 2010 for 895,000. Bank valuation for mortgage was 945,000. The people selling were happy as they bought for around 125,000 euro (1999) and spent probably another 50,000 on improvements like double glazing, new kitchen etc. My point is the 1.25 million was a stupid figure anyway, was never worth that so the owners were content with the sale price.

  • #107675
    Profile photo of logan
    logan
    Participant

    50% to 60% from peak to today across the board on the costas. In Murcia and other poorer regions like Almeria a 70% drop is not unknown. There are still far too many vendors who believe if they sit tight prices will rise back to peak. Vendor delusion is an obstacle to market movement and is contributing to the continuing stagnation.

  • #107676
    Profile photo of Chopera
    Chopera
    Participant

    @logan wrote:

    50% to 60% from peak to today across the board on the costas. In Murcia and other poorer regions like Almeria a 70% drop is not unknown. There are still far too many vendors who believe if they sit tight prices will rise back to peak. Vendor delusion is an obstacle to market movement and is contributing to the continuing stagnation.

    I don’t think a front-line villa in Mallorca will have fallen by the same amount as an empty off plan development in Malaga that is still waiting for its services to be connected. I don’t think an apartment in a decent complex in an established resort will have fallen by the same amount as an apartment in the same area but set a couple of miles inland. I don’t think an property in an area popular with Germans will have fallen by as much as a property in an area popular with Brits and Irish. Any new build in an area that has been deemed illegal might well be unsellable, worth less than nothing (even if it is legal).

    So I don’t think you can say something like

    50% to 60% from peak to today across the board on the costas

    There will be large variations according to location and type of property. It’s those differences that I’m hoping this thread will reveal.

  • #107677
    Profile photo of katy
    katy
    Spectator

    Yes I agree with that. It does seem that the newer properties built after 2004 have suffered the biggest drops. Probably because most were built in less desirable locations. The constructors also cut corners during the boom as they thought they could get away with selling crap (well they did). The same happened in Florida, communities built miles from anywhere and those are the ones who have lost the most. Many built on the CDS after 2004 are miles from the beach etc. and overlook the toll road.

    Prices may seem to have fallen but only from drastically overpriced Ratner type price fixing.

  • #107678
    Profile photo of logan
    logan
    Participant

    Yes my post was a generalisation but it would almost be impossible to detail on here the average fall for particular properties in each and every Spanish town or region.
    Where the falls are at their highest there is usually a good negative reason, just as property keeps it’s relative value if it’s desirable. However I still maintain my estimates are fairly sound as an average.

  • #107679
    Profile photo of Chopera
    Chopera
    Participant

    @logan wrote:

    Yes my post was a generalisation but it would almost be impossible to detail on here the average fall for particular properties in each and every Spanish town or region.
    Where the falls are at their highest there is usually a good negative reason, just as property keeps it’s relative value if it’s desirable. However I still maintain my estimates are fairly sound as an average.

    I know – I’m just hoping someone might give some actual sales prices for the areas I’m interested in 😉

  • #107680
    Profile photo of Fuengi (Andrew)
    Fuengi (Andrew)
    Participant

    @chopera wrote:

    @logan wrote:
    Yes my post was a generalisation but it would almost be impossible to detail on here the average fall for particular properties in each and every Spanish town or region.
    Where the falls are at their highest there is usually a good negative reason, just as property keeps it’s relative value if it’s desirable. However I still maintain my estimates are fairly sound as an average.

    I know – I’m just hoping someone might give some actual sales prices for the areas I’m interested in 😉

    you never know, what areas exactly?

  • #107681
    Profile photo of Anonymous
    Anonymous
    Participant

    I do nto know the percentages, but I am following prices in (among other regions) Peniscola-Alcossebre. The cheapest ones (for the same apartments which were on sale in July 2011 and are still on sale now) have fallen in prices from about 85K to 65K in 4 months in Alcossebre and the same in Peniscola. In Font Nova in Peniscola, apartemnts whic sold 2 years ago for at least 120K are now 80K Euros.

    Other place where I know a bit:

    – in Riviera del Sol , 2 years ago there were no 2 bedrooms for under 120K Euros. Now there are plenty of them for 85K and under

    – in Almunecar, 2 years ago there was no 1 bedromm apt. for less than 100K, now there are many 2 bedrooms for less than 85K.

    – in Vera (Almeria), 3 years ago the 2 beroom apts. next to the beach were selling for more than 120K. Now there are many 2 bedroom apts. for 59K in the same area.

    – in Benasque, prices are more stable, unfiortunately. 180K Euros the cheapest 2 bedroom apt. 2 years ago, 150-160K the cheapest now.

  • #107683
    Profile photo of Chopera
    Chopera
    Participant

    @fuengi wrote:

    @chopera wrote:
    @logan wrote:
    Yes my post was a generalisation but it would almost be impossible to detail on here the average fall for particular properties in each and every Spanish town or region.
    Where the falls are at their highest there is usually a good negative reason, just as property keeps it’s relative value if it’s desirable. However I still maintain my estimates are fairly sound as an average.

    I know – I’m just hoping someone might give some actual sales prices for the areas I’m interested in 😉

    you never know, what areas exactly?

    Northern Costa Blanca (Denia, Javea, etc). They’re not my favourite coastal areas in Spain, but they are the most accessible to me.

  • #107684
    Profile photo of Anonymous
    Anonymous
    Participant

    @chopera wrote:

    Northern Costa Blanca (Denia, Javea, etc). They’re not my favourite coastal areas in Spain, but they are the most accessible to me.

    Have you tried Castellon province?

    There are plenty of people from Madrid there in July-August.

  • #107685
    Profile photo of Chopera
    Chopera
    Participant

    I should add that if anyone wants to get the low down on prices in a specific block of flats (and indeed any other gossip about the neighbours) then they should do what Hercule Poirot always did when investigating a murder – go and speak directly with the consierge. They will also know all there is to know about all the other flats in the area, since all the consierges in any area will know each other and may even work for the same company.

  • #107686
    Profile photo of Chopera
    Chopera
    Participant

    @flosmichael wrote:

    @chopera wrote:

    Northern Costa Blanca (Denia, Javea, etc). They’re not my favourite coastal areas in Spain, but they are the most accessible to me.

    Have you tried Castellon province?

    There are plenty of people from Madrid there in July-August.

    If we were looking for somewhere that we only used ourselves then I’d definitely consider somewhere like Peñíscola. However we’re looking to buy something we can rent out easily in the peak season and then use it ourselves for long weekends during the rest of the year. I imagine Castellon doesn’t have that much of a rental demand.

  • #107687
    Profile photo of Anonymous
    Anonymous
    Participant

    A property is only worth what someone is prepared to pay. I am looking for an apartment in Marbella and I am still faced with Estate Agents hyping the area and asking prices that are too high. It may be a while before I find a seller who accepts the market has really changed. One development we like has properties reduced from just below €1m to approaching €500K, so almost 50% down. Even at these prices I am not tempted.

  • #107688
    Profile photo of Anonymous
    Anonymous
    Participant

    @chopera wrote:

    @flosmichael wrote:
    @chopera wrote:

    Northern Costa Blanca (Denia, Javea, etc). They’re not my favourite coastal areas in Spain, but they are the most accessible to me.

    Have you tried Castellon province?

    There are plenty of people from Madrid there in July-August.

    If we were looking for somewhere that we only used ourselves then I’d definitely consider somewhere like Peñíscola. However we’re looking to buy something we can rent out easily in the peak season and then use it ourselves for long weekends during the rest of the year. I imagine Castellon doesn’t have that much of a rental demand.

    Alcossebre was quite full last summer. So was Peniscola in 2010.

    Unfortunately, the number of places to rent owned by English speakers is quite small in Costa Azahar and this makes them think that they can ask bigger prices. On the other hand, very few British people seem to be interested in going to Costa Azahar so the small number of rental places seem to be hard to ocupy.

    I would say that Oropesa del Mar, as bad it looks nowadays and as much bad publicity as it got, might have the potential to become a good investment if buying for peanuts (if there is a further 50% reduction of the current prices).

  • #107689
    Profile photo of Anonymous
    Anonymous
    Participant

    @Ruefguet wrote:

    A property is only worth what someone is prepared to pay. I am looking for an apartment in Marbella and I am still faced with Estate Agents hyping the area and asking prices that are too high. It may be a while before I find a seller who accepts the market has really changed. One development we like has properties reduced from just below €1m to approaching €500K, so almost 50% down. Even at these prices I am not tempted.

    As I wrote in my posting, Benasque is another example of a place where places have fallen by only about 15% since the peak. It is also one place where I would consider buying if the prices fall more…

  • #107690
    Profile photo of logan
    logan
    Participant

    The principal point to remember, which many ignore when assessing if a property is worth a particular price is supply. If an area is littered with empty unfinished or even completed unsold developments then the value has to be very low. Asking prices are a different thing and rarely if ever reflect the true market value.
    Spanish Costas are literally littered with the stuff. Best estimate 1.5 million unsold properties overall in Spain. Who in their right mind wants to buy anything in a market so over supplied?
    Price become irrelevant because whatever you pay under these circumstances you will lose money.

  • #107696
    Profile photo of Anonymous
    Anonymous
    Participant

    Nominal and real (inflation adjusted) minimum price falls Oct. 200 – Dec. 2011 according to research by Borja Mateo. Strong stuff. He is famously bearish, but if he is even half right….

    http://www.libremercado.com/2012-01-23/la-caida-del-precio-de-la-vivienda-provincia-a-provincia-1276447730/

  • #107698
    Profile photo of Anonymous
    Anonymous
    Participant

    Bought my Almerimar investment property (lol!!) in Summer 2004 for 189k Euros
    Obtained keys Summer 2007
    Sold Feb 2009 for 129k Euros. (But it sold quickly due to the low price)

    So a loss of 31% excluding buying costs which were an additional 10+% on that 189k Euros.

    A later phase was market from around 230k Euros and today the many apartments in the complex which are for sale are still not selling at 120k Euros.

    So if its a generic 2 bed, 2 bath apartment in Almerimar then a fall of 50% or more is accurate.

  • #107699
    Profile photo of logan
    logan
    Participant

    All these statistics have a margin for error and are in themselves a generalisation. I am not sure what the point of them really is. As a poster said a property is worth what someone is prepared to pay and what a vendor is willing to receive for it.
    Statistics such as these are fairly meaningless and reliable only as a rough guide to the macro picture.

  • #107700
    Profile photo of Anonymous
    Anonymous
    Participant

    @logan wrote:

    All these statistics have a margin for error and are in themselves a generalisation. I am not sure what the point of them really is. As a poster said a property is worth what someone is prepared to pay and what a vendor is willing to receive for it.
    Statistics such as these are fairly meaningless and reliable only as a rough guide to the macro picture.

    Of course a property is only worth what someone is prepared to pay, but concrete examples of past and recent transactions help give you a feel for that. It’s not an exact science, but it’s the best guide there is to market prices. Certainly more useful than the official figures 😀 So if you’re not interested in this information, just pass on this thread 😉

  • #107701
    Profile photo of Chopera
    Chopera
    Participant

    @mark wrote:

    Nominal and real (inflation adjusted) minimum price falls Oct. 200 – Dec. 2011 according to research by Borja Mateo. Strong stuff. He is famously bearish, but if he is even half right….

    http://www.libremercado.com/2012-01-23/la-caida-del-precio-de-la-vivienda-provincia-a-provincia-1276447730/

    As a potential buyer I found this part of the article quite interesting:

    Según Juan Fernández-Aceytuno, director general de ST-Sociedad de Tasación en declaraciones del 28 de junio de 2011, los precios de los inmuebles que se anuncian se encuentran como promedio un 15% por encima de los precios a los que finalmente se cierran las operaciones .

    Also the figure they give for Madrid ties in with the estimate I gave earlier. So I think this is a good guideline, at least better than nothing.

    It looks like they’ve used some stats from Idealista based on what people were offering for flats online. I remember from when we advertised our flat on Idealista there was this tool allowing a potential buyer to indicate to the seller what they were prepared to pay, just by a click of a button. Unsurprisingly I got a lot of speculative offers of around 25% less than our asking price. I imagined people just putting in very low offers in on every flat in Madrid with the hope of finding a desperate seller on the verge of being repossessed. Not a bad tactic. So I imagine those statistics will be skewed on the downside (which I guess might compensate for the speculative asking prices).

    Also I think data from Idealista and Fotocasa will be biased towards primary residences and the Spanish market. But as I said above. It’s better than nothing.

  • #107702
    Profile photo of Anonymous
    Anonymous
    Participant

    From what I have been seeing Mark I don’t think those figures are too far off the ballpark.

    I have long felt and stated that I felt the Tinsa figures were 1-2 years behind what was actually happening in the market. If you were to project their figures forward, with a further 8-10% decrease, they would look very similar to those.

  • #107705
    Profile photo of Anonymous
    Anonymous
    Participant

    @mark wrote:

    Nominal and real (inflation adjusted) minimum price falls Oct. 200 – Dec. 2011 according to research by Borja Mateo. Strong stuff. He is famously bearish, but if he is even half right….

    http://www.libremercado.com/2012-01-23/la-caida-del-precio-de-la-vivienda-provincia-a-provincia-1276447730/

    Hi Mark,

    do you know where one could find some price evolution figures for the period 2001-2011 or even better 1996-2011?

    The 2006 figures were way too way to be useful. I would say the 2011 price should not be bigger than the 1996 price plus 75% or 2001 price plus about 30%.

  • #107717
    Profile photo of Anonymous
    Anonymous
    Participant

    jp1, just come back from a biz trip to almeria and checked out almerimar; it’s great near the port and from what i see you can buy a water view apartment for less than €100,000 — certainly a place to keep an eye when the market improves a bit – it’s a steal at below a €100,000 with that great infrastructure – prices will be soft for a few years though but certainly worth swooping on the right unit (corner SW facing) 🙂

  • #107720
    Profile photo of angie
    angie
    Spectator

    Those figures are best case scenario from a bearish forecaster and look pretty accurate to me certainly in those areas of Spain that I know. Prime location will suffer less, whereas those figures will increase on mass look-a-like urbanizations, and worse still on poorly presented property, that’s when 70% decreases or worse, unsaleable, could figure 🙄

    Half right, it still looks dire for Spain ❗

  • #107725
    Profile photo of katy
    katy
    Spectator

    @UBEDA wrote:

    jp1, just come back from a biz trip to almeria and checked out almerimar; it’s great near the port and from what i see you can buy a water view apartment for less than €100,000 — certainly a place to keep an eye when the market improves a bit – it’s a steal at below a €100,000 with that great infrastructure – prices will be soft for a few years though but certainly worth swooping on the right unit (corner SW facing) 🙂

    Had a golfing holiday there, it’s a fly ridden dump with rubbish floating in the marina/sea. 50,000 would be about right! Have they got rid of the surrounding sea of plastic yet?

  • #107728
    Profile photo of Anonymous
    Anonymous
    Participant

    @flosmichael wrote:

    Hi Mark,

    do you know where one could find some price evolution figures for the period 2001-2011 or even better 1996-2011?

    The 2006 figures were way too way to be useful. I would say the 2011 price should not be bigger than the 1996 price plus 75% or 2001 price plus about 30%.

    The Housing Ministry used to publish data that far back, they are now part of Fomento, but I can’t see the historic data any more. I didn’t look too hard so you try:
    http://www.fomento.gob.es/BE2/?nivel=2&orden=35000000

  • #107738
    Profile photo of Anonymous
    Anonymous
    Participant

    @mark wrote:

    @flosmichael wrote:
    Hi Mark,

    do you know where one could find some price evolution figures for the period 2001-2011 or even better 1996-2011?

    The 2006 figures were way too way to be useful. I would say the 2011 price should not be bigger than the 1996 price plus 75% or 2001 price plus about 30%.

    The Housing Ministry used to publish data that far back, they are now part of Fomento, but I can’t see the historic data any more. I didn’t look too hard so you try:
    http://www.fomento.gob.es/BE2/?nivel=2&orden=35000000

    I think this is a relevant graph:

    http://es.wikipedia.org/wiki/Archivo:Vivienda_n_jun2009.png

    This is the evolution of the medium price for new buildings since 1983.

    In 1983 the average price was 250 Euros, in 2007 was almost 3000 Euros, now it is a about 2400 Euros. This means the prices are about 10 times bigger than around 1983.

    The inflation since 1983 is about 300%.

    There is going to be lots of pain… A 50% reduction or more from the current prices for the hard to sell property is very likely.

  • #107782
    Profile photo of Anonymous
    Anonymous
    Participant

    I can give an example of a property price fall in Marbella. We are currently in the area and have been observing the price falls for the last 12 months. My personal feeling is there is still a way to go. We are viewing some property tomorrow on a nice mature development of about 100 apartments on the so called “Golden Mile”. I estimate about 30% of the apartments are on the market based upon my research of multiple web sites. This property was originally listed at €1.1m, dropped to €700K and has been further reduced to €580K. Just over 50% decrease from the first listed price. I still expect further price decreases and will wait to see how 2012 develops.

  • #107783
    Profile photo of Anonymous
    Anonymous
    Participant

    Excuse my maths, not quite 50% but almost.

  • #107784
    Profile photo of Chris McCarthy
    Chris McCarthy
    Participant

    @mark wrote:

    Nominal and real (inflation adjusted) minimum price falls Oct. 200 – Dec. 2011 according to research by Borja Mateo. Strong stuff. He is famously bearish, but if he is even half right….
    http://www.libremercado.com/2012-01-23/la-caida-del-precio-de-la-vivienda-provincia-a-provincia-1276447730/

    I wouldn’t argue with that table, its about the most accurate representation I think I have seen actually.

  • #107786
    Profile photo of Anonymous
    Anonymous
    Participant

    Blimey! What a depressing read. Though we all want to be rich, and increasing house prices help us to feel that way, the only people who are in real trouble are those who bought near the peak and now have to sell through necessity, e.g. illness. They have my sincere sympathy. The rest of us presumably bought because we truly adored what we were buying. So stick with it, enjoy it and wait for better times. If you are thinking of buying, you are in a great position so get on with it, and buy the best, most expensive property that you can stretch to, – you won’t regret it. This is not the first property slump we have had, and I’m not sure that it is the worst – at least interest rates are not near 20% as in the 90s. I’ve been active in Spain for 30 years and I’ll give one example. Bought in Catalonia (Aiguablava) in 2001, towards the end of a big slump, at 240kE, sold in 2009 at 785kE. Not clever, just lucky and patient. No-one else was buying in 2001 the world was just crawling out of the last recession. Have faith, the good times will be back, – there is massive wealth in the world, it will percolate through in time and prices will rise. Spain is a very attractive country, especially compared with those currently booming, and the new rich know it!

  • #107787
    Profile photo of Chris McCarthy
    Chris McCarthy
    Participant

    @davidvick wrote:

    …e currently booming, and the new rich know it!

    Welcome to the forum but….

    Oh you so gonna get it in the neck now!

  • #107788
    Profile photo of Anonymous
    Anonymous
    Participant

    spain is a very attractive country and its just a shame that the spainish government have not moved with the times and made reforms to the employment laws and cracked down on the corruption that is endemic in the local and regional governments.In my eyes spain will always be an attractive country if crackdowns are inforced, over building and illegal building in some areas have spoilt the areas they are in

  • #107789
    Profile photo of Chopera
    Chopera
    Participant

    @davidvick wrote:

    Blimey! What a depressing read. Though we all want to be rich, and increasing house prices help us to feel that way, the only people who are in real trouble are those who bought near the peak and now have to sell through necessity, e.g. illness. They have my sincere sympathy. The rest of us presumably bought because we truly adored what we were buying. So stick with it, enjoy it and wait for better times. If you are thinking of buying, you are in a great position so get on with it, and buy the best, most expensive property that you can stretch to, – you won’t regret it. This is not the first property slump we have had, and I’m not sure that it is the worst – at least interest rates are not near 20% as in the 90s. I’ve been active in Spain for 30 years and I’ll give one example. Bought in Catalonia (Aiguablava) in 2001, towards the end of a big slump, at 240kE, sold in 2009 at 785kE. Not clever, just lucky and patient. No-one else was buying in 2001 the world was just crawling out of the last recession. Have faith, the good times will be back, – there is massive wealth in the world, it will percolate through in time and prices will rise. Spain is a very attractive country, especially compared with those currently booming, and the new rich know it!

    Interesting post (although I’d say the world crawled out of the last recession in the mid 90s rather than 2001). Also you left out another reason why people might be forced to sell – they don’t have a job and can’t afford the mortgage (not uncommon in Spain) Also I think interest rates in Spain only got near 20% in 1991 and steadily decreased for the rest of the decade (and the one after that) Of course the Spanish economy will improve – but it might not happen for a while (bad thing) and it might not be accompanied by a credit/housing boom (good thing) In fact the ideal scenario would be for the Spanish economy to improve and house prices to remain low.

  • #107790
    Profile photo of angie
    angie
    Spectator

    Chris is probably right about getting stick.

    You paint a nice picture of Aiguablava, a completely different area to the overbuilt and highly corrupt Southern Costas, and a much better long term investment, much prettier part of Spain and far less overdeveloped.

    However with the massive oversupply of guestimates ranging from 1-2 million unsold newbuilds, plus huge numbers of resales, many of which are shoddy construction, mass urbanisations, many illegal, poor exchange rates for Brits, exhorbitant completion costs, a still unregulated property industry(agent, developers, lawyers) your advice if aimed at Brits is barking at this time. 1000’s of Brits and others stuck in property that has halved in their perceived value, that they can’t sell, many half way up mountains in little villages or in huge ghettos along the coast, no work, pension going nowhere, and drink is their main solace if they can still afford it, they tried their ‘life in the sun’ and it wasn’t all it had been cracked up to be!

    Yes there’s huge wealth in the world but not for the masses like those duped in to buying in the previous Spanish property boom and bust debacle, the masses now don’t have the wealth you talk about, and if they did, would they want to buy that unsold crap which scars the Southern Costas now they know about the scams? It will be a very long wait for that lot to be a good investment, it needs bulldozing and a regulated and better quality build to replace it.

    You’re right it’s not the first property slump in Spain, but as sure as hell, it’s the worst and the largest Spain has ever had!

    Having had my rant, there are a handful of reasonable agents in the South as well as some good developments in areas that will hold up but you really do have to do your homework and should you buy, don’t expect a quick return, go for a lifestyle change.

  • #107792
    Profile photo of Chris McCarthy
    Chris McCarthy
    Participant

    @angie wrote:

    Having had my rant, there are a handful of reasonable agents in the South as well as some good developments in areas that will hold up but you really do have to do your homework and should you buy, don’t expect a quick return, go for a lifestyle change.

    Am tucked up under the covers checking my iPad, and this made me chuckle, sends me to sleep with a smile, not at the subject which is very serious, but because sometimes you get it so right on the button with your pitch and tone of voice Angie, that it impresses the hell out of me.

    I can’t argue with this view at all really, knocks me for six with its heartfelt, and righteous sincerity.

    Of course I see other things differently and there are other arguments to your point, and I am never going to agree with you that often, but you win the day here. 10/10 for a post I would say!

  • #107794
    Profile photo of GarySFBCN
    GarySFBCN
    Participant

    The problem is that many of us need a mortgage, and the 25 year mortgages I’ve seen are not fixed rate interest, and that was with me offering to pay 40% cash up front (in Barcelona).

    Variable rate interest mortgages are the next real estate economic disaster waiting to happen.

  • #107796
    Profile photo of Chopera
    Chopera
    Participant

    @garysfbcn wrote:

    The problem is that many of us need a mortgage, and the 25 year mortgages I’ve seen are not fixed rate interest, and that was with me offering to pay 40% cash up front (in Barcelona).

    Variable rate interest mortgages are the next real estate economic disaster waiting to happen.

    Spot on. I’ve been in Spain for 8 years and all the fixed rate deals have been considerably worse than the variable rate deals (often double the rate). The banks got lucky when the euribor was going down because most Spanish mortgage rates are revised once a year, so a few months after each yearly revision the mortgage rate would usually be well above the the level of interest the banks were paying. But when the euribor rises the banks will find that fewer people will be able to pay and those who do will usually be paying at a lower rate than what the banks borrow at.

  • #107797
    Profile photo of logan
    logan
    Participant

    @davidvick wrote:

    Blimey! So stick with it, enjoy it and wait for better times. If you are thinking of buying, you are in a great position so get on with it, and buy the best, most expensive property that you can stretch to, – you won’t regret it. Have faith, the good times will be back, – there is massive wealth in the world, it will percolate through in time and prices will rise. Spain is a very attractive country, especially compared with those currently booming, and the new rich know it!

    In normal times this advice could be considered fairly sound. Recessions came and went relatively quickly and those who invested low were able to sell well after the market returned to norms. You were unlikely to lose providing you could afford to sit out the downturn and enjoy your life style choice. Recessions were generally fairly predictable.
    The problem is today this recession is far from normal. It’s the worst since the thirties and may well be historically the most dangerous financial period western democratic countries have yet had to face. There is nothing on the horizon to suggest it’s coming to an end. In fact it’s continuing to worsen.
    I am not a prophet of doom more a realistic investor. When I see a bull market forming I go for it. Property is a commodity like anything else to buy and sell when the market conditions are favorable. That is the key to successful investment knowing the market and understanding how markets are directly affected and influenced by swings of global economics.
    I do accept that people buy into Spanish property for reasons other than financial return. That is a personal choice and fine if it’s affordable both now and in the future. Market fluctuation is then not a concern.
    However if it’s bought on credit, market volatility is. You need to be very sure the value of your property will always exceed the debt and your mortgage repayments and overheads are stable and affordable in good and bad times.
    Those essentials are impossible to predict right now. Uncertainty prevails everywhere and that fact alone is a very solid reason to stand back.

  • #107798
    Profile photo of angie
    angie
    Spectator

    Why thank you Chris 😉

    💡 I would like to run Spain for them but I doubt they would let me 😆 Or, maybe sort out their property problems with a few other experts on here 😛

    David put a view which although interesting quite frankly cannot be compared with the Southern Costas, his area is in many people’s opinion, much prettier and less developed than down South, almost a different country really, and for those reasons less likely to bomb.We thought of buying around Pals and Palafrugell area once, and I used to do business importing ceramica from dusty La Bisbal (fantastic hidden restaurant there) and environs years ago too, lovely coastline! I really liked Gerona too once inside the city. His example of his lucky 9 year wait in Catalonia turning in to a fine profit was little different in reality to the UK’s housing profits or those achieved in the Costa del Sol during the same period.

    I’ve no objection to buying down South provided it’s not anything to do with the massive oversupply of new builds, I’d rather buy in to a small niche development about to be built and fully up to date and legal etc, but still I would wait for the exchange rate to improve. That’s not to say on sites like Viva’s etc there are reduced interesting established fincas like one in Alozaina/Casarabonella (?) you know, near the lakes, some have got a bit of character about them.

    Sleep well ❗

  • #107799
    Profile photo of Anonymous
    Anonymous
    Participant

    Having spent the week viewing properties in the Marbella area I have to say how sad it is. Many of the properties we have viewed are owned by older people who want to move back home to be nearer to their families. All nationalities and not just Brits. They are stuck in a gilded cage with an unrealistic valuation of their properties worth. I feel sorry for them as they are unable to move on with their lives. I also asked the estate agents what is selling and they said “cheap and cheerful”. So far we have not come across anything we consider to be priced near to reality so it may be a while before consider buying here.

  • #107801
    Profile photo of Anonymous
    Anonymous
    Participant

    @Ruefguet wrote:

    I feel sorry for them as they are unable to move on with their lives. I also asked the estate agents what is selling and they said “cheap and cheerful”.e.

    Don’t feel sorry for somebody who is somehow greedy…

    I guess the definition of “cheap and cheerful” varies between vendor, buyers and estate agents… By probably a factor of 3.

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